CCH Tax Day Report
The Minnesota Department of Revenue has issued a bulletin addressing the new personal income tax exemption for military pension income. Beginning in tax year 2016, taxpayers who receive certain types of military retirement pay (including pensions) may subtract that retirement pay from their taxable income. Taxpayers qualify for this subtraction of their military pay is taxable on the federal return and computed under U.S. Code, Title 10, sections 1401 to 1414, 1447 to 1455, and 12733. Taxpayers who claim this subtraction may not claim the nonrefundable credit for past military service. The department also notes that for tax years 2015 and earlier, military retirement pay (including pensions) is taxable.
The full text of the bulletin is available at: https://content.govdelivery.com/accounts/MNREV/bulletins/15ef247.
New Exemption for Military Pension Income, Minnesota Department of Revenue, August 24, 2016